Moira Shire Council has apologised for a rates error that would potentially have cost $500000 and now requires 17000 rates notices be re-sent.

Moira Shire chief executive Mark Henderson said the mistake resulted from human error and a lack of control systems to double-check the figures.

The Courier understands the Capital Improved Value figure council used was for the previous financial year, resulting in only a 2.5 per cent rate increase rather than the planned 5.5 per cent increase.

‘‘We should have had better controls in place, we apologise for any inconvenience,’’ Mr Henderson said.

He said reactions to the gaffe had been mixed.

‘‘From ‘The sky’s going to fall in, and this is the most catastrophic thing that’s ever happened’, through to ‘That was stupid, don’t let that happen again’.

‘‘The latter being what I think is more relevant to this situation.

‘‘I guess if you’re looking for an upside, we didn’t overcharge people.

‘‘Unfortunately, when you don’t charge them enough and multiply it by 17000, it puts a fairly sizeable dent in our revenue.’’

It comes in the same week council voted against a 1100-signature petition calling for an independent probity audit into council’s operations.

But Mr Henderson said he did not think the rates error and independent probity audit were connected in any way.

‘‘The independent probity audit would look at a whole range of things, it’s more about financial viability — whether you’re in the right business, whether you’re doing it well, or are you too expensive.

‘‘This (rates mistake) is an internal checking process of a billing system, not something that a probity audit would remotely go near.’’

Mr Henderson said internal controls would be improved through increased oversight.

‘‘The rates officer will do the work, finance manager sign off on it, then director of corporate (governance) will sign off again.’’

When Mr Henderson sent an internal memo to councillors about the mistake last week, at least one councillor leaked the email to the media. It’s a move Mr Henderson said was ‘‘not a good look for council’’.

‘‘What does it say about the person (councillor) that does that? I think you should make that judgment, not me,’’ he said.

‘‘Is that an example of good governance at work? No.’’

Mr Henderson said launching an independent probity audit was not appropriate as it would potentially interfere with an ongoing Independent Broad-based Anti-corruption Commission investigation.

Mr Henderson said he was not at liberty to discuss the IBAC investigation’s progress.

The IBAC investigation was started after it was alerted to an internal report from council into payments above $150000 not subject to a tender process, a requirement under the Local Government Act.

The report found 42 potential breaches out of 65 aggregated payments tested for the period July 1, 2011 to December 31, 2013.